California Commodities | Investment Outlook
July 27, 2020
Before we analyze projections for our current investment opportunities, it’s important to take a look at the state of California’s commodities as a whole. Viewing macro trends provides necessary context for any potential investment decision. Farmland is no different.
Return on investments in farmland have been positive every year since 1990 (averaging around 12% ROI). This includes cash flow from crops and appreciation in the value of the land itself. According to the
California Department of Food & Agriculture, California
accounts for 13% of all economic agriculture production in the United States.
Dairy Products, Milk — $6.37 billion
Grapes — $6.25 billion
Cattle and Calves — $3.19 billion
Strawberries — $2.34 billion
Lettuce — $1.81 billion
Floriculture — $1.22 billion
Tomatoes — $1.20 billion
Oranges — $1.12 billion
For another look at a potential macro-trends, read our previous blog post on hedging against inflation.
Almond Projections (and historical data) from the Almond Board of California
Pistachio Projections from the Pacific Nut Producer
FarmCek operates at the nexus of positive macro trends and even more favorable micro factors. Specifically, profitable investment opportunities in two of California’s most lucrative commodities, Almonds and
Pistachios.
In 2019, FarmCek’s Almond Orchard produced 8.8% more almonds than projected and sold a 6% higher price than projected. We accredit this to our extensive knowledge on farmland investing and expert level farming.
We are projecting another 13.3% IRR for 2020. This property is nearly 80% funded. Investments close at the end of August 2020. Investing now allows investors to receive returns as soon as January 2021, from the 2020 harvest.
Our Pistachio Development is targeting an IRR of 11.5% and is a development project. Investors funds will go to purchasing high quality farmland and developing a state of the art pistachio orchard. We are currently accepting members on our waitlist, those who will be notified as soon as this exciting offering becomes available, likely in August 2020. Sign up today to be added to the Pistachio Development Offering waitlist.
Identifying a trend or opportunity is not the same thing as capitalizing on that opportunity. With agriculture crowdfunding, you don’t have to worry about day to day operations
of running a farm. But please, still do your due diligence.
It’s important to understand how the underlying asset will be managed and what terms you’re signing up for. We strongly recommend working with a team of experts when it comes to both farmland investments and farming experience. Another thing to look for are opportunities that give you ownership of the operation, the crop sales and the ownership of the land. You should also be ensured regular updates on the progress of your farm from those who are managing it. This is the experience we offer at FarmCek.
We want our investors to experience the highest possible return for investing with us. You can find more details about how we structure deals in our investor portal.
FarmCek’s CEO Brandon Silveira also owns and operates a farm management company. For properties located local to us, and with crops we are experienced in managing, Farm & Land Inc. will provide the day to day operations of the properties. This gives us the ability to have a very close eye on the care of the properties and ensure that they are being managed in a way that best serves our investors. If Farm and Land company is not able to manage one of our offerings, a farm management company will be hired after very careful vetting by our team of expert farmers. This synergy provides peace of mind to our investors. Experience the benefits of direct ownership without the hassle of managing the farm itself.
